Seoul shares end 3.35 pct down on recession jitters

(ATTN: ADDS bond yields at bottom)
SEOUL, Dec. 2 (Yonhap) -- South Korean stocks closed 3.35 percent lower Tuesday, tracking overnight U.S. losses triggered by reports on the American economy's recession, analysts said. The local currency fell sharply against the U.S. dollar.
The benchmark Korea Composite Stock Price Index (KOSPI) fell 35.42 points to
1,023.20. Volume was moderate at 414.82 million shares worth 4 trillion won
(US$3.19 billion) with losers outnumbering gainers 711 to 136.
"Steep falls on Wall Street rattled the Seoul bourse in early trading, but the
local market managed to cut losses to some extent as investors picked up shares
to benefit from year-end dividends," said Kwak Jung-bo, an analyst at Hana Daetoo
Securities.
Wall Street tumbled sharply on Monday as the National Bureau of Economic
Research, a nonprofit group which classifies U.S. business cycles, and a slew of
economic data declared the world's largest economy has been in recession since
December last year while the chairman of the Federal Reserve Ben Bernanke
acknowledged that the economy remained under considerable strain.
The Dow Jones industrial average tumbled 7.7 percent, recording its second-worst
daily loss this year, while the tech-dominated Nasdaq composite index shed 8.95
percent to end at 1,398.07.
Tech shares were hit hardest as investors bet the global economic downturn will
crimp demand for consumer gadgets. Market heavyweight Samsung Electronics lost
4.72 percent to end at 454,000 won and its smaller rival LG Electronics lost 3.90
percent to finish at 76,300 won.
Automakers extended losses for a second day after a report on Monday showed a
drop in domestic car sales last month amid consumer spending reductions. Industry
leader Hyundai Motor fell 5.73 percent to 38,650 won, with its affiliate Kia
Motors plummeting 7.53 percent to 6,260 won.
Some financial shares, however, managed to finish in positive terrain on massive
buying among foreign investors. Mirae Asset Securities climbed 0.78 percent to
64,500 won and Shinhan Financial Group gained 1.69 percent to end at 30,000 won.
The local currency closed at 1,464.25 won to the U.S. dollar, down 24.25 won from
Monday's close, as offshore investors dumped the Korean won, dealers said.
Bond prices, which move inversely to yields, rose sharply. The return on
three-year Treasuries fell 0.26 percentage point to 4.44 percent and the
benchmark yield on five-year government bonds tumbled 0.20 percentage point to
4.63 percent.
odissy@yna.co.kr
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